‘Blackmail’: Why mum was slugged with triple insurance premium
SINGLE mum Julie Reis felt sick to her core when the house and contents insurance premiums for her Tully home arrived last week.
From a manageable $5700 per year, her new total premium had nearly tripled to $13,496. The astounding increase smashed her household budget like a lead weight.
"I am a single mum, there's no way I can pay this," Ms Reis said.
Through some intense lobbying she was able to reduce the premium to double what she was paying last year.
Ms Reis had reluctantly made a claim on her policy due to rain damage in January, fearing she would trigger an increase.
"(I was) told it would not send the premium higher if we made the claim ... but it nearly tripled," Ms Reis said.
She said her pleas for a reasonable explanation for the hike have fallen on deaf ears.
But the staggering rise may have more to do with a quirk of accounting than damage.
Cairns insurance campaigner Roger Ward said companies were applying risk according to postcode, and with little competition in the Far North, premiums were running rampant.
"Some of these premiums are 3 and 4 per cent of the value of the property," Mr Ward said.
"Premiums of $9000 to $11,000 are unsustainable."
Ms Reis is not alone in suffering "insurance shock" in the Far North.
Ross Grant, body corporate chairman of Manoora apartment complex Springfield, said property owners were being "held to ransom" as insurance premiums increased.
Compulsory building insurance at his 12-unit complex increased from $10,498.69 to $14,110.80 this year, with only two insurers offering cover.
"There used to be five companies, last year that went down to three and this year on the slip our broker provided, it showed three declined to cover. They declined to take the risk," Mr Grant said.
"It's blackmail, they know we have no choice."
He said despite making no claims in the past five years, he'd never received a straight answer on rising premiums.
The body corporate of Clifton Sands holiday units has joined the chorus, writing to federal MP Warren Entsch.
"The one premium quote we have received so far is from our current insurer," it wrote.
"Our premium however, has increased in one year by $23,064, to a total of $41,064.
"How can this be legal or justified in the space of 12 months, when essentially, nothing has changed?"
Ms Reis's insurers refused to comment on her policy, but did say "that insurance premiums are risk based and in many areas of Far North Queensland there is a higher risk of cyclone and flood damage than the rest of Australia.
Originally published as 'Blackmail': Why mum was slugged with triple insurance premium